BERLIN: Air Berlin, Germany’s second largest airline, reported a wider second-quarter operating loss on Tuesday and said the third quarter would be challenging after attacks in Europe deterred travellers.
The carrier, 29 per cent owned by Abu Dhabi-based Etihad, said on Tuesday its second quarter loss before interest and tax (EBIT) totalled €62.7 million ($70 million; Dh255.34 million), compared with a loss of €15.9 million in the second quarter last year.
Like other airlines in Europe, Air Berlin is feeling the impact of travellers becoming more cautious about taking trips after attacks in France, Belgium and Turkey.
“The demand, especially on flights to holiday destinations, suffered from terrorist attacks in Europe and had a major and negative impact on Air Berlin’s financial performance,” Chief Executive Stefan Pichler said in a statement.
Air Berlin and others have moved seats away from popular holiday destinations such as Turkey and Egypt to Spain but that has resulted in pressure on fares, Pichler said. Air Berlin said the overall pressure on revenues from the weak market backdrop would also affect the third quarter, traditionally the peak summer holiday season when European carriers make most of their money.
The carrier, which has made a net loss in seven of the last eight years, is trying to attract more higher-paying business customers as part of a restructuring plan that aims to return it to profit. Last week, it announced new routes to the United States and plans for a business class row on European short-haul flights.
Pichler said he was confident Air Berlin would come through the current tough backdrop thanks to new routes and the partnership with Etihad, although cautioned “considerable changes throughout the whole business” would be needed.
The German airline’s revenue per available seat kilometre dropped by 6 per cent in the second quarter, while average fares dropped 5.8 per cent.
It said it reduced unit costs by 3.3 per cent in the second quarter and increased its ancillary revenues by 27 per cent.
